Indonesia will further develop the horticulture industry in South Sulawesi’s Enrekang and Gowa districts as part of a nationwide program that aims to cash in on increasing local demand for high-value crops, like vegetables, fruits, and ornamental and medicinal plants.
The project is supported by the Asian Development Bank (ADB), which recently approved an $85-million loan to develop the country’s horticulture sector. The project will improve the climate resilience, sustainability, efficiency, and profitability of horticulture production in dryland areas located in several provinces across Indonesia. An estimated 25,000 poor and near-poor farmer households, including 5,000 women farmers, are expected to directly benefit from the project.
Apart from Enrekang and Gowa, the Horticulture Development in Dryland Areas Sector Project also covers provinces, from western to eastern Indonesia: North Sumatra (Dairi, Karo, and Papak Barat districts); West Java (Sumedang district); Central Java (Batang and Wonosobo districts); East Java (Gresik, Lumajang, and Sumenep districts); Bali (Buleleng district); and East Nusa Tenggara (Ende district). It is estimated that 25 farmers households will benefit from the project in each horticulture village.
“The project comes at an opportune time for Indonesia, which is experiencing growing domestic demand for horticulture products and increasing threats due to climate change,” said ADB Country Director for Indonesia Jiro Tominaga in a news release. “By helping boost the productivity and resilience of the horticulture sector, the project will help increase employment opportunities and encourage new businesses in rural communities.”
Indonesia’s horticultural output in 2021 was valued at $21.2 billion, up 2.1% from 2020. Demand has outpaced the supply of horticultural products, leading to increased imports from countries such as the People’s Republic of China, Thailand, and the United States.
However, Indonesia’s horticultural sector faces several challenges, including access to quality and affordable seeds, inadequate infrastructure and technology, and insufficient logistics support. A media report said high production costs and small production scale have also made Indonesia’s horticulture products more expensive than its neighbors. Improving horticulture in Indonesia is important to meet the country’s growing food needs and to help smallholder farmers profit from their plots of land.
To address the challenges facing the sector, the project will introduce climate-resilient land, soil, and water management systems, establish a systematic process to engage with the private sector along the value chain, increase participation by women and youth in horticulture, and introduce digital services. The project will provide farmers with high-quality and certified planting material for horticultural crops that are suited for agroclimatic conditions at project locations. It will also introduce climate adaptive on-farm practices, including grants to farmers to purchase inputs and farm equipment to increase climate resilience.
The project is also expected to improve horticultural value chains and access to markets by establishing and strengthening micro, small, and medium-sized enterprises (MSMEs), promoting partnerships between MSMEs and the private sector, and investing in post-harvest facilities managed by farmers groups.
In addition, the project will introduce relevant government agencies to best practices in horticultural development, including mainstreaming climate change adaptation in horticulture.
The International Fund for Agriculture Development will also extend a $40-million loan to the project to be partially managed by ADB.